Chrysler cuts Illinois jobs
Fortunes often turn on a dime in the auto industry and on Thursday it was Chrysler's turn as its new owners announced 12,000 jobs will be cut, including 1,000 at its Belvidere plant.
Less than two years ago Belvidere's leading business people gathered for a gala to celebrate Chrysler's $419 million investment in the local plant and the first Dodge Caliber to drive off the factory floor.
Belvidere's largest employer since being built in 1965, Chrysler's downturn resonates in this town of just 21,000.
"It not only has a business impact, it also has a psychological impact," said Fredric Brereton, mayor of Belvidere. "The plant is the most identifiable landmark between the collar counties and the border of Wisconsin."
Chrysler intends to discontinue the third shift it added in 2006 after modernization allowed the plant to make multiple models, including the Dodge Caliber, Jeep Compass and Jeep Patriot.
Chrysler said the job cuts will be a mixture of layoffs, early retirements and job transfers by the first quarter of next year. Jobs in engineering, procurement and financing may be targeted.
Brereton said he was informed early Thursday morning the 3,800-worker plant would continue to operate without the overnight shift.
The job cuts will also have an affect on regional suppliers and secondary businesses such as retail stores and restaurants, Brereton said.
Brereton said the heavy investment in 2006 may contribute to the plant's survival and the area's economic welfare. He points out 1,500 jobs were created with the modernization.
"We're still up 500 jobs from two and a half years ago," Brereton said.
The cuts come in addition to the 13,000 layoffs Chrysler announced in February as part of a massive restructuring plan. Those cuts included 11,000 production jobs and 2,000 salaried jobs.
"The market situation has changed dramatically in the eight months since Chrysler established the Recovery and Transformation Plan as its blueprint," Bob Nardelli, Chrysler's chairman and chief executive, said in a statement.
The automaker will also eliminate shifts at several other assembly plants. In addition to Belvidere, shifts will be eliminated in Toledo, Ohio; Brampton, Ontario; the Jefferson North plant in Detroit; and Sterling Heights, Mich.
The announcement comes just days after the United Auto Workers union ratified a four-year deal with the automaker. Chrysler became a private company in August when DaimlerChrysler AG, now called Daimler AG, sold 80.1 percent of Chrysler to the private equity firm Cerberus Capital Management LP.
The company also announced it will eliminate four models through 2008: the Dodge Magnum wagon, the convertible version of the Chrysler PT Cruiser, the Chrysler Pacifica crossover and the Chrysler Crossfire sports car. In the same time frame, Chrysler said it plans to add the Dodge Journey crossover and Dodge Challenger. It will also add two new hybrid models, the Chrysler Aspen and Dodge Durango.